Banking-as-a-Service: How it Can Catalyze Financial Inclusion

New technologies and business models are upending long-established markets across virtually every major sector. Financial services are no exception, as traditional retail banks are joined by a growing number of digitally native partners and challengers.

What will be the implications for incumbents, regulators, for investors? And what will it mean for financial inclusion and the many stakeholders working to make universal access a reality?

In mid-2018, CGAP launched an effort to understand this change and how it may alter the very nature and structure of banking. The initiative focused on three broad innovation spaces defined by different sets of actors.
• Digital banks from the plain startup challengers to radically new business models like Banking-as-a-Service.
• Fintech startups and the funding and innovation eco-systems that enable them.
• Platforms like the big tech giants in the US and China as well as local goods or services platforms in emerging markets.

As part of this work, CGPA identified three new business models for retail banking. This publication presents a series of case studies on one of them: Banking as a Service.